A couple in their late 60s converted $120,000 from a traditional IRA to a Roth in 2025. They filed the return in April 2026, paid the federal tax, and thought the bill was closed. That single line on their 1040 just reset their 2027 Medicare premiums, and Social Security will not let them undo it.
This is the mechanic that catches retirees off guard: the Income-Related Monthly Adjustment Amount, or IRMAA. Only roughly 8% of people with Medicare Part B pay it, so a household solidly below the first threshold can move on. Anyone who ran a Roth conversion, sold a business, closed on an appreciated home, or took a large Required Minimum Distribution in 2025 needs to keep reading.
How the Two-Year Lookback Locks Your Premium
Medicare sets premiums from modified adjusted gross income from the tax return filed two years earlier, based on the return already on file rather than current-year income. Your 2025 MAGI, reported on the return most people submitted in April 2026, sets your 2027 Part B and Part D premiums. Your 2026 income will drive 2028. The look-back is fixed, and the return is already at the IRS.
MAGI here is adjusted gross income (Form 1040, line 11) plus tax-exempt interest (line 2a). The add-back is where people slip: municipal bond interest that felt tax-free still counts toward IRMAA. A retiree living on muni income can cross a threshold without ever seeing taxable income rise.
What the Brackets Actually Cost in 2026
CMS released the current-year figures on November 14, 2025. The standard Part B premium is $202.90 per month. Above the first threshold, the surcharge stacks on top. The 2027 brackets will be announced in fall 2026, but the structure below is what your 2025 return is being measured against.
| MAGI, single | MAGI, joint | Part B IRMAA (monthly, per person) | Part D IRMAA (monthly, per person) |
|---|---|---|---|
| ≤ $109,000 | ≤ $218,000 | $0.00 | $0.00 |
| $109,001–$137,000 | $218,001–$274,000 | $81.20 | $14.50 |
| $137,001–$171,000 | $274,001–$342,000 | $202.90 | $37.50 |
| $171,001–$205,000 | $342,001–$410,000 | $324.60 | $60.40 |
| $205,001–$499,999 | $410,001–$749,999 | $446.30 | $83.30 |
| ≥ $500,000 | ≥ $750,000 | $487.00 | $91.00 |
Every surcharge in that table is per person, per month. A married couple both on Medicare pays twice. The couple who did the Roth conversion above, if it pushed joint MAGI into the second joint bracket, now faces a Part B surcharge of $81.20 each plus a Part D surcharge of $14.50 each every month of 2027, on top of the standard $202.90 Part B premium and their Part D plan cost.
The Survivor Trap and What SSA-44 Won’t Fix
When one spouse dies, the survivor files single the following year. The single brackets sit at roughly half the joint ones. The same household income that stayed below the joint threshold can trigger IRMAA or jump a tier on the widow or widower. The bracket shifted while income held steady.
Social Security will reconsider IRMAA, but only for specific reasons. Form SSA-44 covers marriage, divorce or annulment, death of a spouse, work stoppage or reduction, loss of income-producing property, loss of pension income, or an employer settlement payment. Retirement itself qualifies as work stoppage. A Roth conversion does not. A large capital gain from selling a rental does not. A big RMD does not. One-time income spikes that are not qualifying life-changing events generally do not qualify for relief. Readers routinely assume otherwise and lose months arguing before giving up.
IRMAA brackets adjust for inflation each year, but with the 2026 Social Security COLA at 2.8% and per capita disposable income up from $63,638 in early 2024 to $68,391 in early 2026, a household whose income rose with inflation can still drift into a higher tier. The top bracket is not indexed at all.
What to Do Before the Return Is Locked
- Pull your 2025 Form 1040 now. Add line 11 to line 2a. If the total lands within about $20,000 of a threshold in the joint or single table, expect an IRMAA notice from Social Security in late 2026 for the 2027 plan year.
- If a qualifying event happened in 2025 or 2026, file SSA-44 with documentation. Retirement letter, death certificate, divorce decree, or employer settlement paperwork. Do it as soon as the event occurs, not after the IRMAA notice arrives.
- Plan 2026 income now for 2028 premiums. The next return, due April 2027, sets 2028. If a Roth conversion is on the table, model it against the nearest bracket before executing. For a deeper look at sequencing conversions around Medicare cliffs, our Roth Window research walks through the bracket math retirees miss most often.
The tax return is filed. The 2027 premium is essentially set. The only lever left is the next return, and that window is already open.
Contact [email protected] for any questions or corrections.
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